The RBI’s decision to keep the repo rate unchanged at 5.25% but keep its stance neutral shows a balanced and pragmatic judgement in light of the uncertainties prevailing in the world. Though some inflation risks arising from high energy costs and supply chain issues continue to be a worry, the lack of volatility in interest rates is welcome news for home buyers and builders alike.
The move is welcomed by the residential real estate industry, especially for Tier-2 cities, which will maintain affordability and keep the confidence of buyers. The desire of aspirational homebuyers for larger, better planned homes in emerging urban centres, backed by improved infrastructure and connectivity, is continuing to rise.
Demand in the luxury housing segment is also strong, as such buyers perceive luxury homes as an asset and a means of preserving wealth over time. With the stable rates coupled with high end-user demand, the picking up pace from the Tier-2 residential space and the luxury residential space is expected to continue in the coming times.”